Friday, March 2, 2018

Majority of drivers make less than minimum wage and many end up losing money, according to study published by MIT

Uber and Lyft
drivers in the US make a median profit of $3.37 per hour before taxes,
according to a new report that suggests a majority of ride-share workers
make below minimum wage and that many actually lose money.

Researchers did an analysis of vehicle cost data and a survey of more than 1,100 drivers for the ride-hailing companies for the paper
published by the Massachusetts Institute of Technology’s Center for
Energy and Environmental Policy Research. The report – which factored in
insurance, maintenance, repairs, fuel and other costs – found that 30%
of drivers are losing money on the job and that 74% earn less than the
minimum wage in their states.

“This business model is not currently sustainable,” said Stephen
Zoepf, executive director of the Center for Automotive Research at
Stanford University and co-author of the paper. “The companies are
losing money. The businesses are being subsidized by [venture capital]
money … And the drivers are essentially subsidizing it by working for
very low wages.”...